USD Finds Strength in Job Numbers
CURRENCY TRADING SUMMARY – 8th June (00:30GMT)
U.S. Dollar Trading (USD) staged a major rally in the face of increased risk aversion as US data prompted USD buying. Risk appetite was left to the USD/JPY which surged nearly 200 pips higher on the back of the Non Farm Payrolls. May Non Farm Payrolls at -345K beat forecasts of -520K. May Unemployment Rate jumped to 9.4% vs. 9.2% previously. In US share markets, the Nasdaq was down 1 points or 0.03% and the Dow Jones was up 12 points or 0.15%.
The Euro (EUR) eased relentlessly to 1.4000 support after the US jobs data changed the fortune of the dollar. EUR/JPY was very well supported though with the break higher on the USD/JPY countering the major. A pullback after weeks of rallying is healthy for the uptrend with some looking for a break of 1.3925 support. Overall the EUR/USD traded with a low of 1.4069 and a high of 1.4243 before closing at 1.4175. Looking ahead, German Industrial Orders are forecast at -0.3% vs. 3.3% previously.
The Japanese Yen (JPY) broke resistance at 97 and 98 on a major break to the topside with the market reacting strongly to the jobs data and even starting to price in the chance of rate rises this year in the US. US interest rates have being playing a major part in recent USD/JPY movement. Both US and Japan are viewed as funding currencies so long term interest rate expectations are important. Overall the USDJPY traded with a low of 96.56 and a high of 98.89 before closing the day around 98.60 in the New York session.
The Sterling (GBP) came under tremendous pressure with fears of a political storm after many continue to call for PM Brown to resign. Also weighing was USD strength and poor May PPI of 0.4% vs. 0.8% previously. Overall the GBP/USD traded with a low of 1.5939 and a high of 1.6242 before closing the day at 1.5980 in the New York session. Looking ahead, May Retail Sales (BRC) previously at 4.6%.
The Australian Dollar (AUD) although buoyed by the better than expected US jobs news and positive end to stocks the pair slipped off the 0.8000 level as USD strengthened. AUD/JPY performed well as the preferred way to express risk appetite. Overall the AUD/USD traded with a low of 0.7918 and a high of 0.8123 before closing the US session at 0.7950.
Gold (XAU) fell inline with USD strength, easing back to support at $960. Overall trading with a low of USD$952 and high of USD$984 before ending the New York session at USD$958 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.3793 |
1.3926 |
1.3985 |
1.4364 |
1.4621 |
|
USD/JPY |
94.43 |
95.33 |
98.35 |
98.35 |
98.82 |
|
GBP/USD |
1.5757 |
1.5855 |
1.5935 |
1.6435 |
1.6672 |
|
AUD/USD |
0.7830 |
0.7892 |
0.7980 |
0.8263 |
0.8378 |
|
XAU/USD |
936.00 |
941.00 |
959.00 |
990.00 |
1006.00 |
Euro – 1.3985
Initial support at 1.3926 (May 29 low) followed by 1.3793 (May 28 low). Initial resistance is now located at 1.4364 (Dec 29 high) followed by 1.4621 (61.8% retrace 1.6038-1.2330)
Yen – 98.35
Initial support is located at 95.33 (Jun 2 low) followed by 94.43 (May 25 low). Initial resistance is now at 98.35 (Jun 5 Resistance) followed by 98.82 (May 11 high).
Pound – 1.5935
Initial support at 1.5855 (May 28 low) followed by 1.5757 (May 22 low). Initial resistance is now at 1.6435 (Jun 4 high) followed by 1.6632 (Oct 30 high).
Australian Dollar – 0.7980
Initial support at 0.7892 (May 27 low) followed by the 0.7830 (May 29 low). Initial resistance is now at 0.8263 (Jun 3 high) followed by 0.8378 (Sep 26 high).
Gold – 959
Initial support at 941 (May 26 low) followed by 936 (May 21 low). Initial resistance is now at 990 (Jun 3 high) followed by 1006 (Feb 20 high).
